Customer Role

Businesses should not underestimate the customer role in their efforts for managing identity theft and reducing related fraud costs. As I have indicated before, the majority of businesses do a pretty good job at securing confidential information within the boundaries of their business environments; however, they have neglected the vendor and customer role in their battle against identity theft and identity fraud.

As we know, consumer private information is constantly created, duplicated and shared by both businesses and customers. In fact, customers share some personal information with certain businesses, and in return, businesses create additional identity components while they maintain the shared information by customers. Once the new identity components are produced, businesses send these components to customers who must now securely maintain the additional piece of identity. But customers lack the necessary knowledge regarding identity theft risks as well as best practices to securely maintain these additional identity components. For example, in the case of a bank, customers complete a few applications while they provide some personal information and in exchange, the banks validate and approve their identities and provide them with checks, ATM debit cards, and credit cards for their use and convenience. While banks have good intentions to provide valuable services to their customers, they fail to educate their customers about the risks of check fraud, credit card fraud and debit card fraud as well as ways to properly manage these additional identity components. Another example is related to insurance whereby customers share their personal information by completing a few applications and obtain health insurance, car insurance and life insurance. Again, the majority of businesses in the insurance industry fail to educate their customers about insurance fraud and ways to prevent, detect and report them. As an insured individual, when were you last educated by your health insurance company about the risks of medical fraud, how it occurs, and how important your customer role is in preventing, detecting and preventing fraud? In the past, I detected medical fraud committed by a doctor whom I visited only once. He kept charging my insurance company which happened to also be my employer for services which he never rendered. And I kept receiving insurance statements which I carefully reviewed and subsequently detected and reported the fraud. I can only guess that I was not the only patient this doctor was using to commit fraud. But how many people do you think will review insurance statements, detect unauthorized services and follow up to properly report potential fraud? Considering the huge number of elderly and immigrants, I’m sure the doctor had been successful a few times in the past in order to be confident enough to attempt his scheme on me. He didn’t even bother to read my employment information in my files to notice that I was in the business of information protection working for the same insurance company he was trying to defraud.

The final and conclusive point I want to make is that there are many sharks out there who will not hesitate to pray on the innocent and the most vulnerable to defraud consumers and their service providers in many areas, whether online, at the cash machines, or the doctor’s office. Most often, fraud costs are passed on to the customers by raising prices. However, businesses which understand the customer role in their efforts to keep fraud costs down and ultimately offer competitive prices will benefit in the long run by attracting and retaining customers. Some businesses may view the cost of educating customers to be high and unworthy, but I would argue that the long term cost of uneducated customers is even higher for the reasons I just provided.

While some businesses may acknowledge their customer role as a business partner in the battle against identity fraud, their customer awareness and education costs do not need to be high as websites such as this one post regular identity theft articles and send out periodic newsletters to thousands of employees and customers at no cost. Therefore, there is no excuse to ignore the customer role in the battle against identity theft and fraud.

For customized awareness and education programs for your customers, contact IdentityMate.

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